Looking for a Cross-Border Financial Advisor?

Written by Tiffany Woodfield, CRPC®, CIM® Dual-Licensed Financial Advisor
Reading Time: 6 minutes 33 seconds

A cross-border financial advisor is a crucial member of your cross-border financial planning team if you're moving across the border or plan on keeping assets in Canada and the US.

If you're about to make a move or have just arrived, it's important to gather an excellent team that includes a cross-border financial advisor, lawyer, and accountant.

In this article, I'll cover exactly what you need to consider when choosing a cross-border financial advisor. It's essential to work with someone who will help you optimize your US-Canada investments, prevent issues with the IRS and costly mistakes, and minimize your tax burden.

Should Your Cross-Border Financial Advisors Be Located in Your New City?

The old way of finding a financial advisor was to get a referral from a local accountant or ask your friends, who may or may not be in a situation similar to yours. Your main goal was to find someone local.

While this still works in some instances, it may limit your choices. 

These days more of us have become used to working with core team members around the world. You can easily set up a Zoom call with your cross-border advisor and speak with them from the comfort of your own home.

Rather than being limited by geography, you can find the best person to suit your individual needs regardless of where you live now or plan on living in the future. While you probably don't want to get a Zoom haircut, you can easily work with a cross-border accountant, lawyer, or cross-border financial advisor remotely.

You can find the perfect advisory team for you and work with people who understand your situation and with whom you feel comfortable.

We recommend working with a cross-border financial advisor who:

• Can make sense of your complex cross-border situation.
• Can explain things in a way that is easy to understand.
• Specializes in cross-border financial planning.
• Understands your needs.

The Main Cross-Border Financial Planning and Investment Decisions You'll Need to Make

When moving across the border, you're faced with the sudden (and sometimes overwhelming) task of researching a long list of things you hadn't anticipated.

Here are 13 questions that are important to review when considering your cross-border wealth management. Make sure that your financial advisor and accountant help you to answer these questions.

1. Is my current advisor licensed to help me once I reside in Canada?
2. How will Canadian income taxes (which are usually higher) impact me? 
3. I have multiple 401(k) accounts with several employers. What are my options when I move to Canada?
4. Should I consider converting my 401(k) or IRA to a Roth IRA while in the US?
5. Will I be able to claim social security once in Canada? Is this impacted if I also earn CPP?
6. How do I manage assets when I have beneficiaries on both sides of the border?
7. Does a US Revocable Living Trust work the same way in Canada?
8. Can I appoint a non-resident as the executor of my will?
9. Does my financial plan take into consideration income from both sides of the border?
10. Will I have to convert all my US income and currency to Canadian currency?
11. Do I have updated wills and an estate plan?
12. Have I considered the timing of when I am planning on moving?
13. What is the cost of living in the city where I am planning to move?

It can be beneficial to have a pre-move consultation with both an accountant and a financial advisor a year or two before a cross-border move.

Is Cross-Border Wealth Management Essential for You?

If you're planning on selling a home or have significant assets, look for a team specializing in cross-border wealth management as well as cross-border financial planning.

Many people find that not knowing how to manage wealth on both sides of the border correctly can be costly and frustrating. There are more moving parts when you start managing wealth in Canada and the US. By working with a specialized team, you can simplify your life.

At SWAN, we have spent a lot of time unravelling mistakes that our clients could have avoided if they had worked with a team specializing in cross-border wealth management. That's why we have invested so much time on creating online resources. We're passionate about educating and sharing our knowledge.

Who Needs to Work with a Cross-Border Financial Advisor?

Anyone moving from the US to Canada who has substantial assets should work with a cross-border financial advisor. But let's go a little deeper than that.

You will likely need to work with a cross-border advisor if you fit into any of the following categories:

Cross-border Commuter

If you're a person who resides in Canada and crosses the border for work, you could benefit from working with a cross-border financial advisor. You're not a green-card holder, but you have an H-1B visa. You'll want to ensure your retirement accounts are managed appropriately. You may have accumulated assets in a retirement account, such as a 401(k) or 403(b). If you work with a dual-licensed advisor, you will not have to collapse your US accounts. You can allow those investments to continue to grow.

Long-term Green Card Holder or US Citizen Living in Canada

You have to report worldwide income as a US person regardless of where you reside. Even an individual who has distant plans of moving to Canada would benefit from the specialized knowledge of a cross-border financial advisor.

Individual with Assets and Pensions on Both Sides of the Border

Working with a cross-border team helps you understand how pensions may impact each other and they can answer questions around the timing of payments.

US Tech Workers Moving to Canada

If you have lived and worked in the US for a few years but are planning a move to Canada, you'll need to manage your 401(k) or 403(b). We've advised several clients who went to university and then worked in the US. They later became permanent residents of Canada and wanted to ensure the assets they built in the US were well managed.

US Citizen Inheriting from a Canadian Relative

An individual who resides in the US and inherits money from a relative in Canada in Canadian currency would benefit from the counsel of a cross-border financial advisor. That's because a cross-border firm offers a dual-currency platform and can hold retirement accounts in Canada and the US.

Canadian Citizen Inheriting from a US Relative

An individual who resides in Canada and has inherited money/assets from a relative in the US in US currency should work with a cross-border advisor. A dual-currency platform means you can keep the money in either currency regardless of where you live.

A Canadian Citizen Living in the US

Although Canada's taxes are based on residency, a cross-border financial advisor can help manage your RRSP as well as your US-based assets to make sure they complement each other.

Cross-Border Tax Planning and Retirement Planning are Equally Important

In addition to finding a cross-border advisor who can help clarify your situation, has specialized knowledge and can manage your assets to minimize an unplanned tax burden, it is also essential to find an accountant with technical expertise and experience working with cross-border clients.

Why You Should Work with a Cross-Border Specialist

Working with a cross-border specialist helps you avoid tax issues and gives you peace of mind. 

You can avoid overpaying tax because your advisor will ensure you're not invested in common Canadian investments that add punitive and complicated tax filings. You'll feel confident knowing that you are onside with the IRS and have mitigated potential pitfalls. 

You'll also be able to relax knowing that you can move back across the border any time with no issues. Once you find a cross-border advisor, they can work with you whether you live in Canada or the US. 

Often, a cross-border advisor will have a network of cross-border lawyers and accountants who specialize in helping people like you. Working together means you get the best result.

I often find people don't realize the weight on their shoulders when they think of the IRS or what they could be doing wrong. Our clients want to know that they can live their lives and focus on their next adventure, not the IRS.

Cross-Border Estate Planning Is Also Important

Nobody likes to think about what will happen to their family when they're gone. It can be an uncomfortable topic. But it's also an essential one.

If you leave behind a cross-border estate without proper planning, you will likely cause stress and increased tax liabilities for your beneficiaries. 

Imagine that you live in Canada and have a son or daughter who lives in the US. If they are the executor of your will, it may cause double taxation because the Canada Revenue Agency (CRA) may see it as a foreign resident trust. That simple act of having someone who lives in the US acting as your executor has created a serious problem.

There are many factors to consider when you have assets on both sides of the border. Proper estate planning is essential to ensure your wishes are followed and your beneficiaries don’t face additional stress.

Moving Your Assets and Investments Across the Border Can Be Simple and Easy

When working with the right team, moving your assets and investments across the border should be the easiest part of the move. 

When you have a team that has done this before, the transition will be smooth. When you know the steps to take, have a team to guide you, and can follow a process, the daunting task of moving your finances is greatly simplified.

Summary of Key Points:

• Clients we can help are US citizens, green-card holders, H1-B visa holders, dual-citizens and individuals inheriting across the border.
• It's critical that you work with a cross-border accountant to understand your particular tax situation.
• Cross-border estate planning is essential. If you want to make sure your beneficiaries are taken care of, then advance planning is necessary.
• Moving investments can be simple when you have steps to follow.

Next Steps

If you’re planning your retirement and need help with wealth management, estate planning, and portfolio management, please get in touch. At SWAN Wealth, we specialize in cross-border financial planning and wealth management.

More Cross-Border Financial Planning Articles & Guides

If you’re planning a cross-border move, these articles and guides will help you simplify your move and make sure you’ve got everything covered.

Roth IRA Canada: How to Manage Your Investments Across the Border

The Ultimate Financial Planning Resource for Dual Citizens or Green Card Holders Living in Canada

401k in Canada - A Comprehensive Guide to Help You Stay Onside with the IRS and Avoid a Large Tax Bill

Retiring to Canada - A Financial Planning Guide

Financial and Tax Planning for US Citizens Living in Canada

Canadian RRSP Facts for Dual Citizens, Expats and Canadians

Information in this article is from sources believed to be reliable, however, we cannot represent that it is accurate or complete.  It is provided as a general source of information and should not be considered personal investment advice or solicitation to buy or sell securities.  The views are those of the author, SWAN Wealth Management, and not necessarily those of Raymond James Ltd.  Investors considering any investment should consult with their Investment Advisor to ensure that it is suitable for the investor’s circumstances and risk tolerance before making any investment decision.  Raymond James Ltd. is a Member - Canadian Investor Protection Fund. Raymond James (USA) Ltd., member FINRA/SIPC. Raymond James (USA) Ltd. (RJLU) advisors may only conduct business with residents of the states and/or jurisdictions for which they are properly registered.

About the Author

Tiffany Woodfield is a dual-licensed financial advisor and the co-founder of SWAN Wealth Management, along with her husband, John Woodfield. Tiffany specializes in advising clients who live both in Canada and the United States and need to simplify their cross-border financial plan, move their assets across the border, and optimize their investments so they can minimize their tax burden. Together Tiffany and John Woodfield help their clients simplify their cross-border finances and create long-term revenue streams that will keep their assets safe whether they live in Canada or the US.

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